RUSSIAN BRANCH, REPRESENTATIVE OFFICE,
SIMPLE SUBDIVISION, REGISTRATION VIA INTERNET
YOUR COMPANY IN RUSSIA
A foreign company may directly (without establishing a Russian company) be present in Russia via:
- representative office
- branch or
- simple subdivision.
All these forms are not separate legal entities and are the integral parts of the parent company. Subsequently, the disadvantage of all these forms is that the parent company is fully liable to Russian contractors and state authorities for all activities of its branch, representative office or a simple subdivision. A representative office is entitled to represent the interests of its parent company, including marketing and advertising, setting up contacts, public relations etc. Commercial activity is however not possible.
A branch may perform all function of a representative office as well as carry out commercial activities. Being a part of the parent company, a branch performs commercial activities on behalf of the parent company. In other words, all contracts are concluded by the branch exclusively on behalf of its parent company.
A simple subdivision may generally perform all functions of a parent company, but in practice has many restrictions. A simple subdivision is often not acceptable for Russian partners, license purposes, participation in tenders, etc. It may not engage the so called “foreign highly qualified employees” (i.e. foreign employees with a 3-years visa and labor permit, simplified migration and taxation regime). Please read more about foreign highly qualified employees here.
If a foreign company is not present in Russia and provides services for Russia remotely via internet (including provision of software, games, music, videos, books, advertising, trading services, storage or processing of data, domains and hosting) it shall be registered as a taxpayer in Russian tax authorities. The registration is normally done via Internet.
Please pay attention that all these forms may not import goods for the Russian market. A limited liability company is required for import operations. Please read more about limited liability companies here.
It could be a good idea to appoint at the first stage a Russian interim manager as the head of your branch, representative office or subdivision. The interim manager will organize your start in Russia, engage foreign and Russian employees, sign business documents and reports to authorities and be permanently present in Russia to control and report to you. We will be glad to provide you with the services of an interim manager. Please read more about interim manager here.
A branch, representative office and a simple subdivision shall have an office in Russia. The landlord’s consent may be necessary for registration. We will be glad to provide you with an office suitable for registration.
DOCUMENTS FOR REGISTRATION
The following documents (with Apostille) will be generally necessary from the mother company for registration:
- articles of association
- trade register extract
- tax registration certificate
- decision on establishment of a Russian branch or a representative office
- power of attorney for the head of the branch or a representative office
- power of attorney for the lawyers (for signing an application and filing documents to authorities)
- regulations on the Russian branch or a representative office (may be signed by the mother company or by our lawyers).
We will be glad to provide you with necessary drafts, organize notarized translations into Russian and communicate with authorities. The cost of translations normally does not exceed 1.000 euro.
REGISTRATION OF A BRANCH OR A REPRESENTATIVE OFFICE
Procedure for registration of a branch or a representative office is the same.
The first registration step is the approval of the number of foreign employees by the Chamber of Commerce and Industry of the Russian Federation. The approval takes about 3-5 days and costs 21.000 rubles (approx. EUR 300).
The next step is the accreditation of a branch or a representative office in Russian tax authority in Moscow. The accreditation fee is 120.000 rubles (approx. EUR 1.800). The official term of accreditation – 25 business days.
The third step shall be the registration in Russian statistics authority and social security funds. Registration in statistics authority and funds shall be done automatically on the basis of accreditation, however, sometimes it shall be done manually. After that a branch or a representative office may open bank accounts and start its business.
REGISTRATION OF A SIMPLE SUBDIVISION
Registration of a simple subdivision shall be done by an application to the Russian tax authority. No state duty shall be paid.
If a foreign company is present in Russia via its simple subdivision, the same documents (with Apostille) from the mother company as for a branch or a representative office shall be attached to the application. The official term of registration – 5 business days.
The next step shall be the registration in Russian statistics authority and social security funds. This shall be done automatically on the basis of information from the tax authorities; however, it may require additional attention sometimes. After the registration the simple subdivision may open bank accounts and start its business.
REGISTRATION VIA INTERNET
The registration of a foreign company that provides services in Russia via Internet may be done online via the web site of the Russian tax authority. Only an application and a trade register extract from the mother company are required. Apostille and notarized Russian translation are not necessary. The official term of registration is 30 business days.